General Market Comment
US indices ended the month on a positive note on Wednesday lifted by shares in the Automobiles & Components (+4.25%), Software & Services (+2.94%) and Media (+2.82%) sectors. The S&P 500 still posted its biggest monthly loss since 2011. On the economic data front, U.S. companies added 227K jobs in October which was above the 187K estimate compared to a revised 218K in Sept. MBA mortgage applications fell 2.5% last week compared to a gain of 4.9% in the week prior. Finally, the Chicago purchasing manager index declined to 58.4 in Oct (60.00 estimate) vs 60.4 in Sept. The S&P 500 (2,711.74) remains at levels below both its 20d moving average (2,764.61 – negative slope) and 50d moving average (2,845.97 – negative slope).
European markets are expected to start on a flat note.
Foreign Exchange
The US dollar was bullish against all its major pairs on Wednesday. On the economic data front, U.S. companies added 227K jobs in October which was above the 187K estimate compared to a revised 218K in Sept. MBA mortgage applications fell 2.5% last week compared to a gain of 4.9% in the week prior. Finally, the Chicago purchasing manager index declined to 58.4 in Oct (60.00 estimate) vs 60.4 in Sept.
The Euro was slightly lower against most of its major pairs. In Europe, euro zone CPI growth was 2.2% in October in first reading, matching estimates, vs 2.1% a month earlier. Separately, euro zone unemployment rate was flat at 8.1% in September, as anticipated. German retail sales increased 0.1% in September after a 0.3% drop a month earlier (revised from -0.1%). Consensus expected a 0.5% rise. French CPI rose 0.1% in October in first estimation vs +0.2% anticipated and after a 0.2% drop in September. UK GfK consumer confidence index decreased to -10 in October, matching estimates, from -9 in September.
The Australian dollar was bearish against all of its major pairs.
Commodities
After the close of Wall Street, WTI Crude Future (DEC 18) was down $0.9 to $65.31. The contract was below its 20D MA (@ $69.98) and below its 50D MA (@ $69.94). The US Department of Energy reported that, for the week ended 26 October, crude oil inventories increased 3217k barrels compared to the previous week.
Gold was about flat to $1215.2. The precious metal was below its 20D MA (@ $1219) and above its 50D MA (@ $1207).
Copper Future (DEC 18) on Comex was about flat to 265.9c/lb. The contract was below its 20D MA (@ 276.14c) and below its 50D MA (@ 273.75c). In Europe, the London Metal Exchange reported its copper inventories decreased 1625 tons to 137625 tons.